We realize show difficult and tasking it is to find a lender that will provide the best loan for your business or personal use.
Here are a few tips to help guide you to the best decision for your loan.
Common mistakes when applying for a loan:
- Big effect for lenders are high usage of credit cards because business use them Vs. a loan. If possible reduce them before applying.
- Checking your FICO and SBSS score, banks and lenders look at FICO & generally want 600+, SBSS score which is the business credit score that SBA and banks will use. Low is 140, banks will not accept anything under 160, generally they line in the 190++ range.
- Is getting a loan and understanding what you really qualify for. Banks only approve about 10% of loans, general industry with alternative is around 40-60% approvals and have limited industries they serve.
- Finding a lender that matched your requirements and conditions, i.e.., startup, working capital etc. and being prepared with all the requirements and paperwork such as tax documents, personal financial statements, bank statements, etc.
- Cash flow on paybacks to the loans, lenders will match up your cash flow, bank deposits, credit card statements, too see what amount you can actually afford.
- Each time you apply for a loan and they turn you down then you have to start all over again. This really affects your credit score every time you apply. Lenders look at how many inquiries. when they see several they know you are shopping and have n=been turned down.
What Lendingcapital provides: Our bQual report delivers your Small Business Credit Score (SBSS & FICO), your consumer credit score and full credit report, as well as a detailed fundability report assessing your financing prospects. And you may even be prequalified for a loan in real time.
About Us Clients nationwide turn to LendingCapital national funding platform with over 5000 lenders each year to identify the right funding options for their business projects and assistance in meeting their financing needs.
LendingCapital’s bQual application provides business owners the tools and knowledge to understand their creditworthiness before applying for and committing to a loan.
Use our bQual application and save time, energy, frustration, and Know the Score before you apply for a loan.
Credit and small business
I know some of this seems redundant from previous blogs I have done, but, it seems I need to repeat some of the highpoints (or low points depending on how you look at it). Here is short summary of what you need to get together.
Remember this: Almost 90% of all bank loans get turned down.
- Check your credit BEFORE you apply. Places like www.creditchecktotal.com will give you all 3 bureaus.
- CORRECT or explain anything that is negative.
- Create a marketing and game plan (in writing to present)
- Create a BUDGET
- Complete a PFS (personal financial statement)
- 3 years business and tax returns
- 3 years personal tax returns
- Profit and loss statement
- Cash flow is one of the primary things lenders look for-generally most lenders give around 20% of annual sales
- List number of clients (lenders like lots of clients-low number of clients means high risk to a lender
- Get your SBSS score (small business scoring service). You can get this at Nav.com
- If you are looking for an SBA loan: the requirements are a minimum score of 140, most lenders will NOT provide a loan if SBSS score is under 160. The range is 0-300
- SBA loans are difficult to get and can be expensive and take up to 3 months or more to fund. So, if you are in a hurry look elsewhere that is why we offer short and long-term loans.
- Personal FICO score-0-840 most lenders want 650
- D-UN-N-S number (Dun and Bradstreet-100 as the highest a score of 80 is good-free
- Most secondary lenders (non-bank) have very short terms and require daily or weekly ACH payments form your bank
- DO NOT apply at several banks or lenders at once or keep applying-every time you do this it pulls down your credit score-you will not get a loan.
- Most lenders require a minimum of 3 – 6 months in business and do not do startups.
- Have a website, subscribe to places like Yoast (SEO), Rankcrew.com for backlinks, make sure it is HTTPS (secure) you can have the greatest website but who cares if nobody can find it.
- Have engaging content-you only have around 2 seconds or so for someone to keep looking or come back to your site (like this-a blog)
The old bait & switch,” get approved in seconds and get funded in hours”- in lending instant gratification can cost you a lot of money. High interest, short terms, and not as much as they promised or even turned down after they actually pull your credit.
We hope this helps you, our goal is always to help businesses and individuals who want to start a business.
We have realistic lending programs from established to start ups-Lendingcapital is a national direct lending platform.
We are SSL Certified,-Malware & Google Blacklist secured
As an advocate for small to mid-size businesses (I am one) I give a word of caution when shopping for a loan. DO NOT shop 2 or 3 lending or credit institutions at once, every time you go they pull your credit and you get a “ding”.
- Do your homework, Google can save you time and energy and money, shop on line for lenders who favor your type of business, i.e. best lenders for restaurants, machine shop, start up, poor credit etc.
- Go to credit agencies where you can get a full and free credit report without “a ding”-like Credit karma (free).
- Once you obtain your report see what you need to correct or challenge on any information in the report.
- Have a game plan, why you need the money, how it will help grow your business, or start your business.
- Correct BEFORE you apply, or at least have a reasonable explanation.
- Find a lender who will initially accept the credit report you have provided to see if you can qualify with that lender.
- Many lenders will have an on-line see if you qualify without affecting your credit (we do), it helps give you the direction for your next steps.
Simple steps to help you obtain the financing necessary for your business…oh, and read the fine print before you sign.
Be Prepared-Be Informed- Be Pro Active
Commercial lending made easy
It’s that time of year, holiday shopping, excitement for the holidays and….
Next years budget, marketing plan, and where do I get the money from? Party pooper huh? Well a word of caution to businesses shopping for money this holiday season-or anytime for that matter.
- Check your credit-credit karma is good because you do not get any “dings” on your credit report.
- Correct anything that is not accurate NOW
- Do NOT apply at multiple lending institutions, select one and focus on that.
- Once you apply you get a ding, and every time you apply you get a ding-after about 3 dings the banks will give you a “dong”.
- Make sure you read all the terms and conditions BEFORE you sign.
- Make sure you can actually pay back the money.
- Create a marketing plan that makes sense and how you will achieve it and pay for it
Be informed, most banks do not like to lend to companies under 5 years, 2 years and under is very difficult same with start ups, there are factoring companies that can help, make sure you understand all the terms and rates in these type of companies!
Hope you all have a great holiday season and a very prosperous new year